I received this last week, and I thought it was interesting enough that I asked for, and received, permission to reproduce it here:
Rhett Bigham’s New Year Letter to the Profession
In January 1987, I started Rhett Bigham & Associates to conduct recruiting searches in the Process Automation field. My 20th year in business, 2006 proved to be my most successful year so far. For the last few months, I have been posting new jobs on my web site almost daily. See for yourself by clicking the link at the bottom of this email.
Want to know about the future? I am asked continually about where I think the job market for Engineers is headed, so I will take this opportunity to give you my insight as a seasoned recruiter for process industries, mainly refining & chemicals, with some power utility, pharmaceutical, food & beverage, etc.
What is driving the job market? It is all about the “Baby Boomers” born in the U. S. after World War II ended in 1945 & continuing through the early 1960’s. While this is not new information, understanding the implications of a huge population bubble like this is critical to forecasting trends in employment, social programs & even personal investment. Between 2004 – 2014, total U. S. employment is expected to increase 13%. During this ten year period, the primary working group aged 25 – 54 is projected to decline from 69% of the labor force to 65% & the work group aged 55 & older is projected to increase from 16% to 21%. The group aged 55 – 64 will increase 36%, which is more than any other group. The group aged 35 – 44 will decrease in size. Approximately 70 million of the 150 million person labor force in the U. S. are projected to retire by 2014, with only 35 million new workers growing up to replace them. Our government & the largest corporations see the future effect of this population bubble, but the larger the institution, the slower it is to change direction.
Want to know a little engineering history? Engineering experienced good growth from the mid 1960’s through 1984, based on the graduation dates of candidates in my proprietary database of 13,000. As I was born in 1953, I can not speak from experience about this growth, but I can tell you it slowed to a trickle after 1984, when crude oil prices were just above $10 per barrel. After being displaced twice from process equipment sales positions, I became a recruiter in 1985. Capital budgets disappeared & the only hiring was Process Control Engineers that could execute small automation projects under maintenance budgets, if it appeared to have a three to six month return on investment. So I learned to find & evaluate automation related talent.
What is going on with Operating Companies today? Every operating company looks internally & sees they will lose half their work force to retirement by 2014. Operating companies have made early retirement packages too attractive to pass up, so Engineers that hired on after graduation are leaving soon after turning age 55. Operating companies have run lean since 1984 & should have gotten out ahead of this population shift years ago & been hiring entry level Engineers like crazy to backfill this coming attrition. However, controlled by Wall Street’s Day Trader mentality, long term planning equates to next quarter’s financials. So far, I do not even see them staffing up the Human Resources personnel that will be required to hire the Engineers. Oil has just dropped to $50 per barrel for the first time in two years. Capital projects are flying off the shelves & operating companies do not have the engineering staffs to do the work, but if they hurry they will have the staffs to watch contractors do it.
What does this mean if you received your BS after 1980? If you were able to get & keep a job in the process industries during the 80’s, then consider yourself lucky. Now your luck will pay off. Operating companies consider Engineers with BS dates after 1990 the most desirable to re-populate their ranks, but will often consider those with BS dates after 1980. Engineers with 5 – 20 years of experience are in very short supply, due to the downturn in campus hiring starting in 1984. Operating companies will be more secure & exciting than ever, so I suggest you find the right operating company, if you have not already. I predict everyone at operating companies will be able to stay until retirement. There will be a giant sucking sound, which is the upward movement of people filling retirement vacancies. There will be lots of pressure on technical Engineers to manage projects & contractors. If you do not like your company or function or location, this new robust job market should provide previously unimagined opportunity to change your position. Up until a year ago, it was a Client’s Market where multiple candidates applied for a single job opening, but now it is a Candidate’s Market & top candidates will be able to considering multiple job openings.
What does this mean if you received your BS before 1980? Well if you are not rising to the top levels of management somewhere, then allow yourself to think about #1. Where do you want to live? What type of work do you like to do? Are you being paid market value? The project backlog at E&C firms, consultancies & vendors is rising steadily, causing prices to increase for services & equipment. These companies will be hungry for all levels of experience, including early retirees that still desire to work. While this current engineering project boom should last for many years, I can not predict when it will end.
Best wishes for 2007 to exceed all of your goals & desires.
Rhett Bigham & Associates
512-330-1641 or 800-777-0994